The IFS has recently released a report criticising the Coalition’s claim that the budget was “progressive” by stating that it will hit the poor hardest. Instead of criticising the IFS’ work, I believe it is more appropriate to discuss why any genuinely progressive government needs to reform the country and that only through reform can we tackle the structural problems in society.

The first tranche of reform came in the 1980s with the major liberalisation of the British economy. This freed up enterprise and risk takers and created a new and burgeoning middle class. It also was in an era of unbelievable ideological battles between the forces of collectivism and those of liberalism. Ultimately the latter won, but it left a bitter legacy for millions of British people who only remember unemployment, wasted lives and broken families.

The second tranche of reform begins today and we have learnt from the experience of the 1980s. The most vulnerable to change in society cannot be cast off because while some rise to the challenge, others fall by the wayside. The Coalition has been explicit in focusing on the needs of the most vulnerable in society at the expense of “easy” reform.

The most vulnerable in society are not just the poorest, but also the aspirational and middle classes. The recession has resulted in many Britons with lower incomes than before. Higher living costs mean that many are wary of what the future holds. People who have mortgages know that the low rates will not continue forever, but are fearful that they will not only be unable to afford higher interest rates but that they will be unable to realise any capital gains on the sale of their property. Indeed, the most vulnerable are not only those who are reliant on government largesse, but are many who have barely survived the most brutal downturn since the 1930s.

The people I have identified above are not only the most vulnerable; they are the forgotten people in Britain. They are forgotten because they do not have unions and others advocating for them. They are forgotten because the media bypass them. They are forgotten because they get the occasional outpouring of righteous indignation from politicians, only to see any promise of a New Jerusalem soon whither away to the stark reality of modern life. Luckily, these people are now at the heart of the Coalition’s agenda. Rather than the patronising smile of a Labour politician handing out cheques and then abandoning them to their fate, they will get a Coalition politician who understands the problems and the struggles and who does not leave them to fend for themselves.

The Coalition will be undertaking a second tranche of structural reform. The first achieved a liberalisation of the economy. The second is about converting the State into local community organisations and about achieving structural social change. The biggest problem with the past Government was their assumption that every problem could be handled centrally and that a State is most effective when dictating outcomes irrespective of the needs of individuals. This is simply wrong.

No two communities are the same and therefore public services cannot be universally applied in the same way. “Equality of outcome” is not universal public services with no difference in what is being offered, but rather public services that match the needs of the local community, that are socially and economically sustainable and that acknowledge the uniqueness of local communities. This idea, commonly known as the “Big Society”, combines the best of Conservative and Liberal intellectual thought. It also learns the bitter lessons of previous years and the accumulated wisdom of past experience.

Welfare reform is a major step to change the social culture of this country towards effort, hard-work and enterprise. The State now acts as a giant spin cycle with money coming in from taxpayers only to be spat out to the same taxpayers. This creates a reliance on government handouts for financial security irrespective of need. It also creates a reliance on handouts to maintain a standard of living. This will now change.

Education reform will see the most radical transformation in schooling in generations. It will allow individual’s unique talents to be properly appreciated in schools that match those talents rather than be forced to certain schools as a glorified social engineering project. Do not forget that the current system is designed for social engineering – yet humanity is too complex, too dynamic, to be fine-tuned like a motor. By forcing parents to go to a bad school the inevitable outcomes are parents who pretend to hold religious beliefs or to move house to secure a good school place. Parents care more about their children than the State ever could. These school reforms will help parents without punishing them. It is about liberating families across the country from the dead hand of government bureaucracy.

The economic reforms are about making our public finances sustainable for the long-term. We are facing massive challenges in welfare, education, pensions, energy, infrastructure and many other areas. Raising expectations about permanently high government spending is unrealistic, is unsustainable and is unfair. What on earth is fair about leaving the next generation with over £1 trillion in debt?

This government is progressive. It combines the best Liberal and Conservative traditions and despite what people think, it is a government that will create sustainable, long-term jobs in the face of an economic catastrophe and will help the forgotten people of this country.

Last Thursday the Institute for Government hosted a discussion entitled “The Future of Conservative Thinking”. The heavyweight panel consisted of Nick Boles MP (a member of Cameron’s inner circle), Phillip Blond (Director of Respublica), James Forsyth (Deputy Editor of the Spectator), and Jonty Olliff-Cooper (part of Demos’ Progressive Conservatism Project). 

Big Society Is My Society 

Jonty Olliff-Cooper kicked off the evening by saying Cameron’s goal should be to become the weakest Prime Minister we have ever had. By this he meant the Conservatives enacting the spirit of one of their campaign chants: “Power to the People”. Citizens must become authors of the services they use and reconnect with the processes that impact on their surroundings. Labour’s addiction to legislation created a mood in society where people no longer believed they could be a part of government-run initiatives. If something was the responsibility of the state it was no longer the responsibility of any individual. Why should I pick-up litter in the street? It’s too much hassle to report that bit of graffiti at the end of my road. And so on. 

All those in positions of authority, whether they are ministers of state or local council executives, need to change the prism through which the policy formation process takes place. Those who have the resources need to consider how their decisions will enable people rather than how they exclusively can deliver a solution. The role of government is to make engagement easier.  The environment in which intellectual officials come up with abstract solutions for problems of which they have no practical experience must change. The workings of Whitehall, and city halls, must evolve into a culture where decisions are made based on getting users to solve the problems they face. Successfully reducing the size of the state apparatus in the long-term is all about reducing the demand for government intervention.  

For Jonty, if in five years time the word ‘government’ has been separated from the word ‘bureaucracy’ then Cameron can rightly claim he has presided over a truly transformative regime.  

A Pragmatic Politician Reacting to Radical Times  

James Forsyth made the point that Cameron himself is not a particularly ideological thinker. He is a traditional organic Conservative. The combination of the electorate’s distaste for politicians and the financial swamp which emerged after the credit-crunch, means that his government must be a truly reformist administration. Modern Conservatives’ big and radical ideas are driven by the huge and deep-rooted problems that were left on Cameron’s desk when he arrived at No10. I would have loved to have been a fly on the wall when Britain’s senior mandarin first briefed Cameron on the true state of Britain and then asked “What now, Prime Minister?” The Big Society concept is a practical solution for the actual problems we face (i.e. over centralised control, unaffordable processes, disconnected solutions) and for dealing with the deep-rooted symptoms of alienation, disempowerment and apathy. 

The two most interesting areas to observe if you are a watcher of ‘modern conservative thinking’ will be welfare reform and how different sections of the party react to the Alternative Vote (AV) referendum. On the latter point, James is convinced that at least one Tory cabinet member will campaign for AV, though he did not speculate as to whom this might be. The great unknown is whether this coalition will be an aberration in UK political history and if, in five years time, we will all return to standard first-past-the-post politics, or whether coalitions will become more common. The answer to this question will shape the future of our politics.  

Can you transplant a think-tank into a ministry? Iain Duncan Smith, Secretary of State for Work and Pensions, has been working on welfare reform for over six years at his think-tank, the Centre for Social Justice. Most governments say they want to reform the welfare system only to back out when hard decisions have to be taken. The economic situation means that delay in reforming welfare is not an option if we want to live in a solvent country. Like AV, welfare has the potential to really test the foundations of the Coalition, as Conservatives and Lib Dems tend to have competing philosophies around what is important in this area. 

21^st Century Social Conservatism 

Nick Boles MP has always been interested in how Conservatives reconcile their socially conservative instincts with a world where social liberalism has become engrained in our culture. One of the most radical advancements ‘Team Cameron’ has made is to fundamentally modernise social conservatism by making it relevant to our times. For me this shift in mindset can be best described as Conservatives focusing on promoting values to all rather than making moral judgements about some. The institution of marriage has many benefits for the individuals involved and society as a whole. These benefits should be accessible to anyone who wants to make the necessary commitment, thus it’s natural for Conservatives to be strong supporters of civil partnerships.  

Nick confirmed that current Conservative thinking is a reflection of the culture of this country. Despite its wealth, Britain is not often at ease with itself. People need to be encouraged to gain understanding of their environment through talking to one another. Side-ways communication is the glue that can hold our country together and government should concentrate on making these side-ways chats happen. Some might say it is a paradox that you need the state to foster the ‘Big Society’ idea but this is only a paradox if you believe the state in all its forms is bad. The state is not bad; it was just deployed badly under New Labour. Unfortunately, certain areas of the state will be resistant to a change in mindset but like any careful gardener the government should prune obstructive branches in order to let the good parts blossom. 

Tapping Into The Power of Trust 

The big unknown in Conservativism is discovering the next economic model. The Cameron agenda was created in a different economic framework when everyone thought the argument over which economic system should be adopted had been won by free-marketeers. ‘Sharing the proceeds of growth’ was transformed by the financial collapse of 2008 into ‘we are all in this together’. A new sustainable economic system needs to be developed, one which allows everyone to take part in society. George Osborne has adapted his economic beliefs since the credit crunch. His team are now exploring the idea that there should be a prominent role for Government in supporting particular growth industries. Rather than subsidising individual companies, Conservatives may offer resources towards promoting specific industries. Depending on how this is done the Tories could mend the relationship that Thatcher obliterated with the mechanical North and Scotland. 

Phillip Blond is adamant that free association, through non-state civic groups, can offer the UK a new economic model that has the potential to include everyone. The current systems are corrupted so any political movement that wants to be relevant must ask itself what went wrong and why the West is no longer developing. New politics and new economics will have the greatest chance of success if they are born in relationships that are based on trust. One of the roles of Government needs to be in creating open trust networks where people do not need bureaucracy because there exists ethos and intimacy. Those who cynically dismiss the possibilities of this happening should look at Zopa, the person-to-person lending service, or E-bay, the on-line auction house. In a system such as E-bay a person’s trust rating is often worth more than a single financial transaction. This fact and the innate human desire to live in a fair and orderly society means that 135 million people each year give money to complete strangers for products they mostly have never seen. By tapping into the nature of trust it should be possible to significantly reduce transaction costs. 

Phillip predicts that the Coalition will deliver mass mutualism because our future relies heavily on the success of relationships in economic environments. 

The Future Of Conservatism Is Now 

I left the event with many thoughts buzzing round my head, and two overriding conclusions:

• Conservative thinking is very much of importance now. The Tory leadership does not have much time to reflect as the responsibility of power demands that Cameron puts in place a strategy to deal with the issues this country faces. Conservative thinking in the future will be a reaction to the success and failures of what is done today.
• Progressive Conservative ‘think-tanks’ need to become ‘do-tanks’ if they are to keep their relevance. Organisations that believe in the Big Society and Post-bureaucratic age agendas should now be able to put their thinking into action as the Government is keen to devolve responsibility to outside Government organisations. It’s now time for those who talk the talk to walk the walk.

In a year’s time, the Institute for Government should reconvene this discussion under the updated title: “The Future of Conservative Doing”.

“Red Tory sounds nonsense, doesn’t it?” Phillip Blond, 1 April 2010. 

Last Thursday lunchtime I ignored the canteen’s carb busting offer of lasagne and chips, and wandered up to the RSA. Phillip Blond was on the second leg of his literary tour. In case you’ve missed it he’s promoting his new book ‘Red Tory’, which sets out how the negative parts of the left and right have broken Britain, and how a combination of the good parts is the pill our society needs to make everything better again. 

The RSA held the event in their basement. I imagine that before it became a crypt containing ideas it was probably a splendidly stocked wine cellar. The males in the crowd wore the uniform of the socially conscious Tory. Casual jeans, suggesting that they don’t mind getting dirty, open neck shirt, which says the wearer is beyond the need to be smart but could scrub up if needs be, and a suit jacket to remind everyone that it shouldn’t be forgotten that the person is a well-to-do professional. 

Blond told us how it began to go wrong when Disraeli failed to offer an economic stake to the poor. You cannot be a capitalist without capital, you cannot be part of a capitalist society without having access to capital, and in our society a significant proportion of the population will never have this access. During the 1960s and 70s the liberal left tried to pursue social justice through the state. In the 1980s and 90s the liberal right tried to encourage the creation of wealth by getting the state to back the financial market. New Labour tried to find the middle ground between the two but failed to foster a true ‘stakeholder society’. This failure was inevitable as Tony Blair et al were addicted to the liberal political settlement of post-war Britain. Politicians always confuse and conflate the term freedom with liberalism. For Blond, freedom cannot exist unless you have continued access to capital. The ‘free market’ is anything but free. It rigidly serves those who have capital to spare. 

As the current liberal settlement advances our society becomes more and more static. People only associate with, and do business with, a smaller and smaller pool of people. Meritocracy is a myth as the middle-classes take advantage of the system. For Blond class has become caste. The message from the podium came over loud and clear. None of the current ideologies are working and we need a new political settlement. It is not surprising that many of those who are associated with what Blond views to be a morally and economically inadequate liberal settlement act with hostility to the idea of Red Toryism, and in some cases even towards Blond himself. The politico ideological atmosphere contains many big egos. Whether they are Thatcherite columnists or ex-Blair staffers, none of the previous idealists will enjoy being told they were misguided. 

So that is the problem. What about the solution? Phillip Blond would like to see capital dispersed more widely. The poorest groups in society should have an amount of leverage that will allow them to gain control of their lives. One way of doing this is by giving people control over public spending in their local area. The state would still be an important player but it would have the radically different role of creating an infrastructure for enablement. Blond would like to see the poor given investment vouchers, which they can cash in if they form groups. For example, unmarried mothers could take control of their estate. In Blond’s opinion, they will be the most interested in creating a community that can best facilitate the development of their family. 

I would summarise the Red Tory agenda as wanting to bring moral logicalism to capitalism. At the moment the rich can ride roughshod without giving a thought to the general good as they are free from accountability. Moral accountability can only happen by capitalising all of us. Competition laws need to be strengthened in order to facilitate local capitalism. 

Phillip Blond loves saying the word ‘radicalism’. You can see the sparkle in his eyes every time he utters it. No-one can deny that the Red Tory settlement is radical. The proposal to use the mechanisms of the state to redistribute power in order to create a truly fair capitalist system is a bold one. The optimist inside me is enthused by the vision but the pessimist asks the question is this really all possible? There are few easy choices between right and wrong, and all political decisions have winners and losers. Has Blond thought about who the losers will be? Change and upheaval can lead to discomfort and loss in all parts of society. Will human nature embrace this extra responsibility? 

Phillip Blond is a self-confessed romantic. He believes that you can only be a political visionary if you are a romantic; otherwise a politician is nothing more than a state manager. As a philosopher he can afford to be idealistic. It is decision makers who have to be aware of the consequences. In truth, it suits both sides for Blond to be an arm’s length influencer. He is free to promote his ideas and the Conservatives are free to implement them as they see fit. His Red Tory vision fleshes out Cameron’s statement “There is such a thing as society, it’s just not the same thing as the State” while the Conservative leadership’s interest has allowed Blond to set-up his own think-tank. 

Blond’s admiration for Cameron is strong. “David has a vision. He is the most innovative and visionary politician we have in this country.” 

Phillip Blond’s analysis of why we find ourselves in the current state is compelling. His desire to empower all of us by getting the state to protect and promote community values is exciting. The great unknown is how the journey from now to the future will unfold. To be fair, I think that Blond knows this himself. I am glad that the Red Tory agenda has been given such a high profile. The Conservatives need to create a philosophy for government that reflects 2010. At the moment there are a lot more questions than answers but through the ‘Big Society/PBAge’ debate more and more answers are appearing.

Most political news is about personality and politics rather than policy.  At the moment that’s particularly true – the big stories of recent weeks have been about Brown’s behaviour, Lord Ashcroft, what the polls say.  Next week promises more of the same – a Channel 4 programme on Cameron, and the court appearance of some of the people charged as part of the expenses scandal.

I’ve often wondered how much difference all this news makes.  Sit through a focus group, or speak to your least political friends and you will hear one thing time and time again: “they are all the same”.  So much of this bad political news is just reinforcing what people think anyway – it is “already in the share price” as they say in the City.

Danny Finkelstein made the point nicely in an article last week:

The cynicism about politics is so pervasive that it embraces almost all political activity. Use a statistic? It’s a lie. Cry on television about your dead child? It’s an election gimmick. Attack your opponents’ policy? You would say that, wouldn’t you.   And this cynicism extends to the media and our coverage.  So not only politics, but news about politics, is seen as a fiction inside an untruth wrapped in a piece of spin… Most of politics and most political coverage proceeds as if there was still a reasonable degree of trust. As if the messages were still getting through, still being listened to, still being weighed up.

For the government of the day the clear implication is that what really matters is not their spin but whether they can deliver better results on the ground (a point grasped by Tony Blair some time in his second term).  It is rather more difficult for the opposition to act on this insight.  However, at the start of his time as Conservative leader David Cameron did emphasise that he would always aim to “show, not tell” people that the party had changed.  And there was something of this in Cameron’s initial reaction to the expenses scandal – when he was prepared to take a stand unpopular among some of his MPs.

The big problem for Cameron is that the Government has managed to shift so much the real-world pain the public will feel until after the election by running up huge debts.  So right now the public services are still hiring away. On the ground, things don’t look so bad.  At least, not yet.

We know more or less what the Budget is going to say already.

The Government is thinking not about how to reduce the soaring deficit – but how to spend the receipts from the super-tax in a pre-election giveaway.  We will see mock “surprise” at how much the bonus tax has raised, and condemnation of those who “said it wouldn’t raise any money”.  We will see big figures for savings based around finally officially scrapping the disastrous NHS IT programme and merging a few Primary Care Trusts.  If Liam Byrne has his way (and he probably won’t) the government may even nod to the markets by stressing how “tough” it is planning to be on public sector pay post election (nominal rises less than 1%, meaning small real-terms cuts).  The one thing it won’t do is make any meaningful effort to control the vast deficit.  Instead the Government will try to keep the debate narrowly focused around the timing of cuts – not the content.

Ironically, this is where public cynicism might ride to the rescue of the Conservatives. The idea that politicians will spend now and cut after the election is highly plausible for most world-weary voters. In the 1974 election Willy Whitelaw accused Harold Wilson of going “round and round the country stirring up apathy”.  The Tories won’t need to go round “stirring up” cynicism about the budget.  But they will need to try and be in a position to exploit it.

Neil O’Brien is the Director of Policy Exchange

What do the Tories stand for? The charge that the Conservatives have not made clear what they stand for has been slowly gathering momentum ironically ever since the Conservatives started their ‘one a week’ policy series. Right wing commentators who are fearful that a Cameron Conservative government will not govern in an appropriately conservative enough way have fanned this criticism. A few weeks ago Simon Heffer clarified this view when writing “the problem for the Tories is this, succinctly put to me by a close observer to the party of the day: if you board a bus anywhere in these islands, sat down next to a passenger at random and asked what it stood for, he or she could not tell you”. This got me thinking. Does Simon Heffer ever use public transport? Who is this sage observer who bothers random people on buses? Is the assertion true? I grabbed my Oyster card and went to the bus stop. In the interests of polling methodology I should reveal that I live what Alistair Campbell may describe as a ‘bog-standard’ middle-class London lifestyle.

I won’t lie to you. At first I was a bit apprehensive about approaching people, but I was glad to find that most people do not mind being asked about their opinions. The instant response was ‘umm not sure’ which was then followed by an opinion of what the Conservatives stood for. The two most popular answers were that the Tories would:

• Cut the deficit
• Promote the family

A couple of people said that they would protect the interests of the rich and one lady said she was not sure but they had to be better than the current lot so she would vote for them anyway.

It is only fair that I answer my own question. For me the Conservatives stand for opportunity, which they will facilitate through governing by trust. A Conservative Government will trust local groups to decide what needs doing and how plans should be executed. Labour’s obsession with mechanical control has been both expensive and stifling. It has lead to the ID card debacle; massive increase in state monitoring and situations such as a 64.4% increase in NHS managers. The Conservatives will also focus on the important task of regaining the public’s trust in politicians and Government. This will be done through the transparency agenda, which will allow people greater choice in deciding how politicians should be accountable.

Since I started my little experiment there has been a media frenzy over the Tory poll-acoaster. Most pundits have been asking the question ‘Why are the Conservatives slipping?’ and then answering their own question by saying ‘I told you so, you’re not the right type of Conservative’. This sort of analysis loses sight of the bigger picture. For me the real question should be ‘Why were the Tories so far ahead in the first place?’. This election is the antithesis of 1997. The electorate is not in the mood to place the same amount of trust and hope in our elected representatives as they did with Tony Blair in the great political love-in of 1997. There is an underlying feeling that no prospective government should be given an easy ride or have its promises taken at face value. The people I spoke to could tell me what the Conservatives stood for but this was not the same as them believing that the Tories would make a positive difference. It seems to be that the deal can only really be sealed once a new Government has proved that they are governing in a new way. Many people will enter the voting booths begrudgingly. This will lead to certain amount of electoral volatility, which will manifest itself in some odd results. The polls should be taken with a pinch of salt, and should not distract us from working hard to promote the benefits of a Conservative government.

My conclusion after a week on the bus is that this country is complex. It is full of people with differing needs and beliefs. While a couple of consistent themes did emerge no one gave me exactly the same answer (apart from the two people who looked at me as if I was a madman before declining to answer). The truth is that the question Simon Heffer poses does not have a single right answer. The Conservative party itself is a complex coalition which contains people who can both strongly agree and disagree with each other depending on the issue being debated. What I hope we can all agree on is that the future of this country is best served by electing the strongest possible Conservative Government. The rights and wrongs of certain policies can be discussed after 6 May. As Tim Montgomerie puts it “this election isn’t a choice between a perfect Conservative Party and an imperfect Conservative Party but between a strong government led by David Cameron and the chaos of a hung parliament.”

George Osborne was right when he said, “We are all in this together”. We need to work together to ensure that there is the best future for all.

PS I want to give a shout out to www.futurefairforall.org I often consult this treasure trove of information before I go out canvassing. It has a lot of evidence, which shows that 13 years of Labour has spectacularly failed to create a ‘future fair for all’.